Corporate treasurers give The Banker their views on banking services.

Burnetta Williams, vice-president and assistant treasurer, FedEx Corp, US

The questions

1. World economic growth remains slow. Has your company taken particular financial measures as a precaution against a prolonged downturn? What are they?

2. Most corporates finance themselves with a combination of loans, bonds and commercial paper. How do you decide on the mix that’s right for your company?

3. Many banks use credit derivatives to transfer their lending risk. How do you feel about banks doing this with your loans?

4. Corporate treasurers are being encouraged to place spare cash in money market funds rather than bank deposits. What is your view of this trend?

5. Has the overall service you get from banks improved, got worse or stayed the same over the past 12 months? What kind of further service improvements would you like to see?

1. FedEx constantly monitors its financial measures, even in a booming economy. We have reviewed capital spending and reduced debt in an effort to improve cost structure. We are accelerating the global treasury restructuring and consolidation efforts to improve liquidity and avoid short-term borrowings.

2. Historically, FedEx has matched its assets with associated liabilities. Therefore, it has a proportionate amount of long-term debt and leases. Periodically, we borrow short-term in the commercial paper market for working capital purposes.

3. We rarely draw down loans under our $1bn bank revolver. However, we are aware that our bankers use many techniques to mitigate their lending exposure on drawn and undrawn facilities, which probably benefits us through a lower cost of funds.

4. FedEx invests surplus cash in the safest instruments with the best return. Safety of principal is our primary concern. FedEx continues to invest in mostly collateralised repos and high-grade commercial paper.

5. Basic cash management has improved but the ongoing consolidation of the banking industry has caused service levels to decline. Many of our relationship managers have changed in the past 12 months and there is a learning curve about our banking needs that must be overcome.

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